I am considering both the above cameras as my primary shooter. I know that the Sony RX 100 m2 has a larger sensor so it will probably be better in low light conditions but the new Leica C has twice the optical zoom range as the Sony at 7x optical zoom. Both of course have WiFi and shoot Raw. I am also considering a Lumix DMC FZ70 for when I want to use a longer optical zoom lens.

Do you think the Leica C is a decent alternative to the Sony as an all around shooter?

I'm not sure these cameras are really comparable. I mean, in addition to the differences in sensor size and zoom range you noted, the Leica has a viewfinder, while the Sony doesn't. On the other hand, the Sony's screen tilts, while the Leica's is fixed. And the Sony is 20MP, while the Leica is 12MP. So to me, it's more about figuring out which one matches your needs better.

Full disclosure: I own an RX100 (original) and am considering upgrading to the II for the tilt screen - Mark

P.S. Personally, I'd go with a Pany LF1 over the Leica C because I already have Lightroom.

The Leica C is indeed a rebranded Panasonic, as is true for most Leica compacts (not the X-line). The Panasonic equivalent is the LF1. The Leica costs $699 while the Panasonic is only $499. The price difference is partially justified by the inclusion of Lightroom software with the Leica, the rest is a brand premium or needs to be used to cover the designer fees (Audi designers worked on this one). Another difference is that there are special accessories available for the Leica, but then again, you'll have to buy those separately.

When Leica rebrands Panasonic, as in the case of the Leica C, don't they many times use their own firmware on the camera. I have read that many people have felt that the Leica V Lux 4 is superior to the Panasonic model as they felt that the firmware/software built into the camera was different. Is this true?

The firmware is typically different (also on my D-Lux 5), and I suppose it will be different on the Leica C too. Whether that makes a difference depends on the specific performance of the Panasonic equivalent, so you would have to look / wait for a direct comparison between the two cameras.